More than 60% of pub tenants are unlikely to take out another lease with their pub company because they feel they are being unfairly squeezed, the Federation of Small Businesses (FSB) has told MPs.
The FSB, along with the Campaign for Real Ale, will next week give oral evidence to the Trade and Industry Select Committee, which launched an inquiry into the relationship between pub companies and their tenants in May.
The FSB will argue that pub company profits are soaring while many of their licensees are earning less than the minimum wage. Disillusionment means tenants now stay in leased pubs for just three years on average.
Many publicans, it claims, have to work more than 90 hours a week for wages below £200, while a quarter of couples who run pubs have taken second jobs to survive.
The FSB's submission to the committee cites a West Country licensee who took home less than £8,000 a year, and a publican in the Midlands who earned £10,400 a year (or just over £2.20 an hour) while his pub company creamed off £48,000.
CAMRA will argue that beer ties have resulted in less choice and higher prices, as pub companies have failed to pass on reductions in the price paid to brewers to their tenants and customers.
It wants to see free-of-tie tenancy options and guest beer rights introduced, along with an end to both above-inflation rises in beer prices and to upward-only and RPI rent reviews.
by Angela Frewin
Buy this week's Caterer magazine for more industry news and analysis